Article – How’s Northern Australia developing?

by 21 October 2014

Business Acumen Magazine

The Australian Parliament’s Northern Australia Committee has tabled its final report on the development of Northern Australia, titled Pivot North. The report spells out loud and clear how important the region is – or at least should become – to the long-term economic growth of Australia.

THERE are 42 clear recommendations in the Pivot North report – addressing both opportunities and impediments for the development of Northern Australia. It is a bold vision that has waxed and waned for many decades through political corridors – but this time the doors seem to be snibbed wide open.

Some of that momentum may have been energised by the strong ‘tropical expertise’ research programs and business success stories that have been coming out of the Far North Queensland.

Professor Robyn McGuiggan of James Cook University points out that, mining and tourism aside, ‘tropical expertise’ envelops the potential for the region to lead the world in tropical health, design, construction, engineering, food production, water management and other areas.

“As one of the very few advanced Western economies with a significant footprint in the tropics, there is enormous potential for Northern Australia to be a significant exporter and partner in the growth and development of tropical knowledge worldwide,” Prof. McQuiggan said.

“There is real value, we believe, in explicitly identifying Northern Australia with the tropics as it clearly situates Australia in one of the most dynamic and critical regions of the world.”

Northern Australia is neighbouring a part of the globe in which 40 percent of the world’s population now lives and where 20 percent of global economic output is produced.

The report offers some far-sighted but specific recommendations, establishing a Cooperative Research Centre (CRC) for northern agriculture and developing a national institute for tropical sports and sports medicine.

Research and development and education have also been marked as major growth areas through relationships with the Asia-Pacific region, and engagement with traditional owners has been flagged as a way of unlocking economic opportunities to maximise development.

But the report has also listed significant impediments to development, such as a need for better road, rail, port and aviation facilities and telecommunications services, the cost of power and insurance, access to services and problems with keeping a skilled workforce

UNIQUE CHALLENGES

The report advocates the design and implementation of long-term strategies for the development of capital infrastructure and agriculture in Northern Australia – and for improved regulatory arrangements for aquaculture and better regulation of fisheries to allow for sustainable growth of the industry.

The report also addresses some immediate concerns about the fly-in-fly-out (FIFO) employment practices in the region and recommends improved taxation arrangements to encourage local employment in the resources sector.

“The development of Northern Australia is one of the great challenges and opportunities facing the nation,” committee chair and Federal Member for the regional electorate of Leichhardt, Warren Entsch said.

“Northern Australia covers over 40 percent of Australia’s land mass but contains only four percent of the population. It has abundant land, water and mineral resources. It has medical and educational institutions with world class facilities.

“Northern Australia is on the doorstep of Asia and a significant portion of it is part of the tropical world — which by 2050 will encompass over half the world’s population. There are great opportunities for the people of Northern Australia within the tropical zone.

“But the development of Northern Australia has in the past lacked a commitment by governments at all levels to pursue investment and development in a consistent, sustainable and coordinated way.”

This inquiry has formed one part of a broader process aimed at promoting the development of Northern Australia. The Australian Government has made a commitment to produce a White Paper within a year, outlining the government’s vision for the future of Northern Australia. Mr Entsch said the committee’s findings and recommendations would certainly inform the White Paper process, assisting the government to formulate its policy for the future development of Northern Australia.

Regional Australia Institute chief executive Sue McCluskey said the independent think tank has already released a substantial report on the future of Northern Australia late last year. She said it spelled out the conundrum facing policy makers.

“We believe that Northern Australia offers a unique combination of opportunities for Australia’s future, as well as the unique combination of risks and challenges,” Ms McCluskey said.

“Navigating these challenges and risks and catering for the diverse needs of the north will require a high level of sophistication and a strategic approach by all levels of government and the community.”

POPULATION ‘OPPORTUNITY’

Despite the vastness of scale for so many things up north, there’s one thing that is very small – its population. Just six per cent of Australians live there, spread across cities like Townsville and Darwin, mid-sized towns and mining centres, tourist hubs and agricultural regions.

Growing the population is an issue that many, including committee chair Mr Entsch have identified as one of the most critical challenges that must be overcome if Northern Australia is to prosper.

“The key to any success or initiative that we are embarking on is going to be attracting and retaining a significantly growing population across Northern Australia,” Mr Entsch said. While financial incentives like tax breaks might help, Mr Entsch believes they are only part of a much bigger solution.

The report proposes that Northern Australia has to be an attractive place to live to increase demand for goods and services and to bring in the skilled workforce needed for the powerhouse industries such as mining and associated construction.

The tourism industry – also very important to the north – struggles at times to attract and retain good staff across a range of professions.

It’s an area universities are well tuned into, as Professor William Dawson of CQ University Australia explained.

“If you want economic development in regional areas, universities are absolutely critical to your capacity to recruit and retain good people and keep them in the regions,” he said.

“This gets back to the social side of things – affordability, availability of appropriate services and a whole range of other issues for people from the cradle to the grave,” he said.

Prof. McQuiggan said the economic impact of James Cook University comes through the development of human capital.

“The presence of graduates in a region demonstrably contributes to higher wages and lower unemployment rates and provides a more educated and productive workforce,” Prof. McGuiggan said.

“Provision of excellent professional education in the region is vital to ensuring supply and maintenance of a professional workforce in the region.”

http://www.aph.gov.au/jscna/report

PIVOT NORTH REPORT KEY RECOMMENDATIONS

There are seven priority recommendations identified in the report:

• The creation of a Department of Northern Australian Development based in Northern Australia.
• The identification of key roads and the commitment of funding for their upgrade as a matter of priority, subject to relative benefit assessment. Projects would include the continued upgrade of national highways (including the Bruce and Stuart Highways); Hann Highway; Peninsula Development Rd; Tanami Rd; Outback Way; and beef development roads.
• Cost-benefit analysis should be conducted on a rail link between Mount Isa and Tennant Creek and the building of passing lanes on the Darwin to Alice Springs Railway.
• Funding and development of water infrastructure projects that meet scientific and economic assessments.
• Investigation of the potential and practicality of special economic zones.
• Measures to reduce insurance premiums in Northern Australia to affordable levels.
• Continued funding of the Great Artesian Basin Sustainability Initiative.

Courtesy of Business Acumen Magazine

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